|ARLINGTON, Va., August 19, 2004 – Interstate
Hotels & Resorts (NYSE: IHR), the nation’s largest independent hotel
management company, today announced that it has signed an agreement to
manage 54 hotels currently owned by affiliates of Sunstone Hotel Investors,
LLC, a privately held hotel ownership group based in San Clemente, Calif.
The current Sunstone hotel management team will transfer to Interstate,
but will remain at their existing offices and will continue to oversee
management of the hotels. No changes are planned at the property
level, and the transition will be essentially transparent to current Sunstone
The transaction will close, and is contingent on, the concurrent completion of an initial public offering (IPO) by Sunstone Hotel Investors, Inc., which is currently in registration with the Securities and Exchange Commission. Sunstone Hotel Investors will be a publicly traded real estate investment trust (REIT), which requires that its owned properties be managed by third party operators. Concurrent with the IPO, Interstate will enter into new long-term management contracts, which include both base and incentive management fees, as well as certain termination rights, with the hotels.
“Sunstone’s hotels match up well with our current portfolio,” said Steve Jorns, Interstate’s chief executive officer. “Most of the hotels are located in the western half of the country in markets where we currently do not have a significant presence. This transaction will give us added economies of scale in those markets, as well as a highly experienced operating infrastructure in place.”
The 54 hotels, with 12,643 rooms and located in 16 states, are primarily
premium-branded full-service properties. The hotels include: 24 Marriott-branded
hotels, 16 Intercontinental-branded hotels, eight Hilton-branded hotels
and three independent hotels. When combined with Interstate’s current
managed hotel portfolio, Interstate will operate approximately 320 hotels.
Interstate Hotels & Resorts operates approximately 270 hospitality properties with more than 60,000 rooms in 40 states, the District of Columbia, Canada, Russia, and Portugal. BridgeStreet Corporate Housing Worldwide, an Interstate Hotels & Resorts’ subsidiary, is one of the world’s largest corporate housing providers.
This press release contains "forward-looking statements," within the meaning of the Private Securities Litigation Reform Act of 1995, about Interstate Hotels & Resorts, including those statements regarding future operating results and the timing and composition of revenues, among others, and statements containing words such as "expects," "believes" or "will,” which indicate that those statements are forward-looking.
Vice President, Corporate Communications
Interstate Hotels & Resorts
|Also See:||Sunstone Hotel Investors, LLC Opens $9 million Residence Inn Rochester Mayo Clinic; Fifth Sunstone Hotel Property in Rochester, Minnesota / July 2004|
|Sunstone Hotel Investors LLC and Tarsadia Hotels Expanding by Going After Weaker Hotels in Key Markets / Sandi Cain / June 2003|
|Sunstone Hotels Opens the 196-room JW Marriott Denver at Cherry Creek / June 2004|